Selfless Giving and Tempered Trading

In all cultures that are stamped by Christian influence (and in some that are not), most people celebrate Christmas. Among other forms of marking the holiday, probably the most common is the custom of exchanging gifts. This extraordinary way of conferring goods on others might serve as a reminder of the importance of the other, ordinary way of doing so: commercial exchange.

We so appreciate giving and receiving gifts on Christmas and other special occasions because we recognize that these acts are unusual. Most human beings most of the time do not give gifts to strangers. We instead a reserve it as a privilege for those we love.

Even for those we love, gift-giving is not a daily occurrence. Yes, we give to friends and family frequently: parents take care of children’s room and board; spouses offer daily acts of assistance to each other; friends supply emotional support. But the Christmas gift is another phenomenon. It is something superfluous, or at least something beyond what would normally be given in the course of the year.

It is critical that we never lose this capacity for gift-giving, both the quotidian and the holiday variety. It is inherent in love, which is in turn essential to being human. Yet if we recognize that giving without expectation of payment is extraordinary, then what is the usual way of meeting the wants and needs of ourselves and others?

Adam Smith famously wrote that it was not benevolence but self-interest that motivated the butcher and the baker to supply the items necessary to sate the hunger of their customers. The point has often been distorted to mean that Smith was endorsing selfishness. Instead, the eighteenth-century observer of moral and economic life was gazing in wonder at the harmony normally maintained in the human world, despite the necessity of millions of people seeking a limited supply of goods.

What Smith meant to highlight was that our very efforts to obtain the goods necessary to exist can be life-giving to others seeking the same end, as long as both parties cooperate in a system of free exchange. The butcher might have a large supply of meat, but he needs other things to survive and to thrive; those he can secure by relinquishing some part of the good in which he specializes. His participation in the market is not an exercise in selfishness, but the practice of properly ordered self-interest, which is of necessity tempered by the wants and needs of others.

Selfishness is possible within a market system, as it is in any other. Yet the manifestation of selfishness, of the tendency to focus on “having” rather than “being,” deplorable as it is, should not distract us from the fundamental good of cooperation in the market.

At the international level, this cooperation is called trade. When it is inhibited by obstacles, human well-being suffers. According to current World Bank forecasts, global trade will decline by 2.1 percent in 2009, the first time it has failed to climb since 1975. Capital flows to developing nations will plunge 50 percent. Critics of globalization might rejoice, but that would be wrongheaded. Although the sources of decreased trade — and the global economic slowdown that is its direct cause — are complicated and contested, one thing is certain: it’s not a positive development. Whatever the painful side effects trade sometimes brings with it, the final result is a net benefit for human beings. Rising trade means increased specialization (productivity), more integrated markets (efficiency), and more connected populations (peace).

Endorsement of trade must be qualified. Burgeoning sales of small arms to violence-ridden developing nations is counterproductive in the cause of a more peaceful and prosperous world. The globalization of slavery and prostitution (the two are often linked) does not contribute to genuine human flourishing. “Globalization on its own is incapable of building peace, and in many cases, it actually creates divisions and conflicts,” Pope Benedict XVI said in a recent address. But this is not a criticism of the free exchange of goods. Instead, the pope continues, an increasingly connected world “points to a need: to be oriented toward a goal of profound solidarity that seeks the good of each and all. In this sense, globalization should be seen as a good opportunity to achieve something important in the fight against poverty, and to place at the disposal of justice and peace resources which were scarcely conceivable previously.”

International trade is critical to human welfare. If it is indeed waning as predicted, then let us hope that it reverses course as soon as may be. When it does, the prospects for stability and prosperity for all the world’s people will be improved.